It is expected to fund schemes in cities with urban development companies, such as Sheffield, Manchester and Corby.
Legal & General Property managing director Stuart Beevor said the fund's aim was to act as a catalyst for more institutional investors to back urban regeneration schemes.
He said: "We are establishing something that will create the right momentum to attract others into this field." Beevor said the aim was not to create one building but to work up a masterplan for whole areas.
This would create a ripple effect for other funders, including local developers, to invest in the area.
He said: "We want to manage the social aspect, to fit together infrastructure with developments. We want to create communities." EP is expecting to gain clearance from the European Commission to go ahead with the fund in early summer.
EP commercial director Jim Gill admitted that the fund had taken time to get off the ground because it needed European clearance.
He said: "The process is a frustrating one. But the commission has told us it saw no reason why clearance will not go ahead." Gill said the fund was an ideal combination of the public and private sectors working together on urban regeneration schemes. He said: "This is a model for the future."
